Q&A

It may actually not even be possible for EITHER of those scenarios. The first (80+40) would be above your pre-approved lending amount. The second (50+30) theoretically may work. However, these loans have additional fees and costs that may push the total loan amount above $80,000. For instance, if the scenario were $48k + $32k, FHA would likely require an additional 10-15% "contingency fund" to safeguard against unexpected repairs while making renovations - @ 10% in this case: Purchase Price $48k + Renovation Costs $32K + Contingency Fund $3,200 = $83,200 Loan Amount

A lender would be most knowledgeable on the 203k Loan, especially regarding specifics. Be sure to contact a couple different options until you find a lender that has closed and is currently closing on 203k loans. Don't be afraid to ask how many renovation loans the lender has closed in the past 12 months.

The 203K loan options are a valuable asset to home buyers, however, they can be meticulous and, at times, a real challenge for all parties involved (contractors, consultants, buyers, sellers, municipality, etc) . Having an inexperienced lender handle the transaction can end up being a total nightmare. Some direct lenders may have a "Renovation Loan" specialist, a person who processes all kinds of renovation loans, inluding the 203K & 203k Streamline. That's the lender you want.... more

Have you found a property you are interested in yet? Have you spoken with a lender or viewed the Homepath website? There are many programs available and you may be able to repair your FICA score. I think the first step for you is to talk to a lender willing to work on credit repair.... more

The first step is to select a home mortgage lender and apply for a mortgage if you don't have cash to buy outright. That will tell you how much money you need to put down and how much home you can afford. Generally speaking, a credit score of at least 600 or higher for most mortgage programs.

After that, find a local real estate agent in your area that has the experience and knowledge of the local market to guide you to your home. it should not take too long if the agent is doing their job well. I would be happy to recommend one to you if you like.

You will generally need a money deposit to put down with your offer when you select your home. In our market, that's usually $500 to one percent of the offered price. It is applied to the down payment on your home when you close escrow.

Once the offer is accepted, then I recommend a home inspection to ensure there are no major defects with the home. This can cost from around $50 to $600 depending on the size of the home. If all goes well with the inspection, then you just have to follow your lender requirements to obtain the loan. The lender will have an appraiser go out to determine the value of the home to ensure it is worth what they are lending on. As long as the appraisal comes in at or above the offered price, the transaction generally will go through smoothly. Your local real estate agent can explain more about what to do if the appraisal comes in low.

All factors become an issue when trying to determine market value of a home. It would be best to due as much due diligence as possible before buying or selling. Consulting with a knowledgeable realtor is also helpful in m opinion.... more